How much interest would he earn in the investment

Assignment Help Financial Accounting
Reference no: EM132945438

Thomas set up a savings fund for his son's education so that he would be able to withdraw $1,600 at the beginning of every month for the next 9 years. The fund earns 4.44% compounded quarterly.

Problem a. What amount should he deposit today to allow for the $1,600 periodic withdrawals?

Option 1: $100,388.60
Option 2: $142,332.64
Option 3: $142,857.33
Option 4: $101,502.91

Problem b. How much interest would he earn in this investment?

Option 1: $142,857.33
Option 2: $29,942.67
Option 3: $172,800.00
Option 4: $30,467.36

Reference no: EM132945438

Questions Cloud

Calculate the current market price per share of BFG shares : You have estimated that the industry beta is 1.9. Calculate the current market price per share of BFG's common shares
Determine what is the present value of the contract : What is the present value of the contract if the lease rate is 4.25% compounded annually? A contract requires lease payments of $700 at the beginning.
Identify the accounting issues arising within the scenario : Identify the accounting issues arising within the above scenario, referring to relevant accounting concepts and standards
What amount should A and C account change : In 2020, the partnership had net loss of P125, 624 before the interest and salaries to partners. What amount should A and C account change
How much interest would he earn in the investment : How much interest would he earn in this investment? Thomas set up a savings fund for his son's education so that he would be able to withdraw $1,600
How much is taxable income : She had private insurance from 1 January 2021 and a HELP debt of $20,000. How much is her taxable income? (enter the whole number)
What is the correct amount of petty cash fund : CHECK DRAWN BY THE COMPANY TO THE ORDER OF PETTY CASH 5,000. What is the correct amount of petty cash fund
What is the firm wacc for ssw : The cost of equity is 16.3% and the pre-tax cost. What is the firm's WACC (weighted average cost of capital), and how to calculate?
Find what amount to be credited to ordinary share capital : Find what the amount to be credited to Ordinary Share Capital account will be? If 500 shares of Preference Shares were converted into Ordinary Shares

Reviews

Write a Review

Financial Accounting Questions & Answers

  Calculating the relevant costs

There is enough Alpha material in stock. If it is not used on this contract it is unlikely that it would be required in the near future. If the company chose to sell 4000 units of Alpha it has estimated that it would generate £20,000.

  What is the present value of all the cca tax shields

Assume a 34% tax bracket, a discount rate of 15%, and a salvage value of $10. What is the Present value of all the CCA tax shields?

  Kalriess company ordered a machine on january 1 2011 at an

kalriess company ordered a machine on january 1 2011 at an invoice price of 21000. on date of delivery january 2 2011

  Spent in the future to service warranty claims

Street Factory provides a 3-year warranty with one of its products which was first sold in 2012. In that year, Street spent $80,000 servicing warranty claims. At year-end, Street estimates that an additional $300,000 will be spent in the future to se..

  Which is least likely to be audited by means of substantive

Which is LEAST likely to be audited by means of a substantive analytical procedure? The allowance against doubtful receivables

  What amount should be reported as accounts payable

What amount should be reported as accounts payable on December 31, 2020? An entity reported accounts payable of P4,000,000 on December 31, 2020

  Make adventure manufacturing ltd journal entry for sales

During the year of 2019, Adventure Manufacturing Ltd. Make Adventure Manufacturing Ltd.'s journal entry for sales, cash collection and bad debt expense.

  How much is the depletion charge

How much is the depletion charge in 2020? In 2019, ABC Mining Corp. acquired the right to use 1,000 acres of land to mine for gold.

  Compute the amount of cash paid to suppliers of inventory

Analyzing changes in inventory and accounts payable.- Compute the amount of cash paid to suppliers of inventory during Year 7 for purchases made on account.

  What is the amount of lantz income from operations

What is the amount of Lantz's income from operations (operating income)? Cash collections from customers for services yet to be provided totaled $88,000.

  How do journalize first interest payment and amortization

How do Journalize the first interest payment and the amortization of the related bond discount. A company issues a $1,300,000

  Calculate the effective interest rate for bank

Competing terms from banks (LO2) Summit Record Company is negotiating with two banks for a $151,000 loan. Fidelity Bank requires a 28 percent compensating balance, discounts the loan, and wants to be paid back in four quarterly payments. Calculate th..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd